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Competitive advantage and the software defined enterprise

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By Alastair Corbett

 

I used to think of IT as simply a tool – like a slide rule for the mathematician or a pneumatic spanner for the engineer, simply there to take the load off its operator and make actions quicker.

 

Remember vinyl?

Now maybe I’m showing my age, but browsing through rows and rows of records used to be a common pastime for those wanting to keep up with the latest musical trends. I can see my daughters’ rolling eyes with any sentence involving me and “trendy”…

 

The music industry has changed dramatically over a few decades. Some have moved with the times and others have gone by the wayside. In a short space of time, Zavvi disappeared from the high street while HMV Retail has gone from most.

 

The reality today is that, but for small, specialist outlets, music businesses derive virtually all of their revenue through IT.

 

Your bank – a software company?

IT used to be used just as a tool to automate some of the processing involved in financial transactions. Now, banks simply cannot function without IT – the business is IT.

 

With 13,000 software developers, HSBC could be said to be more of a software company than Microsoft, who employed only 1,000 developers on Windows 7.

 

Change is the new normal

While IT used to be a just solution to the problem of doing things cheaper and faster, it’s now increasingly seen as a tool for competitive advantage. In this arena, the ability to react rapidly to external market forces is critical to maintaining and increasing market share.

 

Rapid reaction has historically not been a strength of IT, where holding off change for as long as possible has been the mantra for decades. With release cycles now measured in days or weeks, a transformation in how IT works is required.

 

It’s not just IT though, as Damon Edwards of DTO Solutions comments, the organisation as a whole needs to ask "’How can we be better and quicker at delivering value to our customers? How can we better react to the forces of the market and win?’ It’s a holistic business problem that needs to be addressed from the top down, not just bottom-up.”

 

A collaborative approach

The traditional large business structure of separate specialist teams plus outsourced functions leads to difficulties when there are hand-offs between teams. This “silo” approach has given rise to efficiency within each group, but inter-team hand-offs remain problematic.

 

The difficulty revolves around lack of information and knowledge passed between departments, so a more collaborative approach with much better information sharing is needed.

 

Enter DevOps

These difficult hand-offs are particularly acute between IT development and operations teams. Software development groups are all about delivering change as fast as possible, whereas operations need to maximise reliability through minimising change.

 

According to Wikipedia, DevOps is a “method that stresses communication, collaboration and integration between software developers and information technology (IT) operations professionals”.

 

Using these approaches and tools, these “silos” have greater visibility of the whole process from business demand through to customer delivery; there is much earlier testing of change so that confidence is higher; and the business achieves change faster, supporting competitive advantage.

 

It’s not just tools

What’s needed to deliver this new approach is a transformation in the way teams work. Tools are important in maintaining a consistent and comprehensive flow of information, but individuals need to understand the wider context too.

 

For example, developers need to understand the IT operations environment and also the end user. As an analogy, an architect needs to understand how builders work. There is no point in designing a spectacular new building if it’s impossible or impractical to build.

 

IT is fundamental to business

So with IT being an indispensable part of the organisation, the collaboration between all departments and teams – including IT – has to be equally effective. The business needs to be defining new or changed products and services that will undoubtedly involve IT components.

 

At the same time, IT should be delivering services that can be consumed by both the business and its customers. This “self-service” approach with highly effective information sharing can lead to great efficiency and the possibility of having customers “build” their own services. This surely represents competitive advantage.

 

Are you a software company?

How critical is IT to your organisation?

Do your developers understand IT operations?

How good is collaboration between departments?

 

Next time I’ll be diving back in to the development world, looking at how apps can be created and tested in a safe but realistic environment.

 

You may be interested in

Solutions for DevOps

 

Alastair Corbett leads HP’s UK&I Software Business Unit and has responsibility for its strategy, the promotion and selling of the IT Performance Suite and related services. Prior to this role, Alastair was responsible for defining the new sales strategy and go-to Market models for Worldwide Software Sales, and before that, he successfully led the Worldwide Services Operations team for HP Software. Alastair joined HP from Peregrine as a result of the acquisition in 2005, where he held the role of VP International Operations and was responsible for all Finance and Operations activities in EMEA and APJ. He also led the integration activity for EMEA, as well as leading the Sales Operations function.

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Comments
KennyFraser

I agree that many companies are becoming software defined, even McDonald's now aims to be digital! I would highlight two other types of company. Firstly, in the software industry we see organisations like Uber which are actually becoming API or platform businesses not software.

 

At the other end of the spectrum, we see companies that can increasingly survive without any IT function. SaaS business models and cloud based mobile apps make this easy for many SMEs.

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